Farmers and millers are both anxious over the Uttar Pradesh government not declaring its state advised price (SAP) for sugarcane for 2023-24, despite the crushing season technically starting from October. “They are supposed to announce it before October, when mills start crushing the new cane harvested by farmers. But it’s now January and we still don’t know what price farmers will get from mills for their current season’s crop,” said V M Singh, convenor of the Rashtriya Kisan Mazdoor Sangathan. Farmer unions are seeking a significant hike in the cane SAP, which was last raised in 2021-22 to Rs 340 per quintal for “general” and Rs 350 for “early-maturing” varieties. Since the 2016-17 season (October-September), the time the Yogi Adityanath-led BJP government has been in office, the cane price in India’s largest producing state has gone up by only Rs 35, from Rs 305-315/ quintal to Rs 340-350/ quintal. This is much lower than during the previous governments led by SP's Akhilesh Yadav (Rs 65 increase; from Rs 240-250/ quintal in 2011-12 to Rs 305-315/ quintal in 2016-17) and BSP's Mayawati (Rs 115-120 increase; from Rs 125-130 in 2006-07 to Rs 240-250/quintal in 2011-12). With Lok Sabha elections due in April-May, there are expectations of a substantial rise in the SAP this time. “Farmers are today paying Rs 45-50/ quintal only as harvesting labour charge, compared to Rs 30-35 two years ago. The cost of fertilisers, pesticides and other inputs have also shot up, even as per-acre cane yields have fallen because of the dominant Co-0238 variety becoming susceptible to red rot fungal disease,” said Singh. But it isn’t farmers alone. Even millers in UP are worried over the delay in announcing the cane SAP. The reason: Diversion of cane to gur (jaggery) and khandsari (cottage sugar) units. These alternative sweetener makers are offering higher prices for cane — Rs 360-400/ quintal – as compared to Rs 340-350 SAP now being paid by mills. “They are paying more, that too immediately in cash after weighment. Our payment cycle is 14 days after cane purchase. We can neither pay in cash nor increase and reduce cane prices just like that. The government monitors the price of both our input (cane) and output (sugar), unlike the unregulated gur and khandsari makers who operate in a completely free market,” said a miller. The worry over diversion is even more, given that this year’s cane crop is seen to be not as good as was initially believed. “Yields are down due to red rot and also top borer (an insect pest) attack,” said K P Singh, CEO of Hans Heritage Jaggery and Farm Produce, which operates a modern fully-automated gur plant at Unn in west UP's Shamli district. His plant, said to be the first of its kind, can crush up to 150 tonnes of cane per day (tcd). That's more than the 10 tcd for an average gur-making kolhu and 50-70 tcd for a khandsari crusher, but way below the 2,500-15,000 tcd crushing capacity range of sugar mills. Kolhus are currently realising Rs 33-35 per kg for gur. At 13 per cent average recovery, they would be grossing Rs 429-455 for every quintal of cane crushed. Meanwhile, the National Federation of Cooperative Sugar Factories Ltd has estimated India’s sugar output during 2023-24 (till December 31) at 112.10 lakh tonnes (lt), 7.6 per cent lower than the 121.35 lt for the same period of the last season. Production is down in Maharashtra (47.4 lt to 38.2 lt) and Karnataka (26.7 lt to 24 lt), while it is up in Uttar Pradesh (30.8 lt to 34.65 lt). For the whole 2023-24 season (October-September), the association has projected the country's production to drop to 305.5 lt (from 330.9 lt in 2023-23). Only UP is expected to register an increase (from 104.8 lt to 115 lt), while the other major states are expected to see a fall — Maharashtra (105.3 lt to 90 lt), Karnataka (59.8 lt to 42 lt), Tamil Nadu (14.75 lt to 12 lt) and Gujarat (10.1 lt to 10 lt).
